Housing is Newsom’s Key to Arrest California's Shift to the Right

Governor Gavin Newsom convened a special session of the California Legislature this past December 2, asking lawmakers to provide him with funding to “Trump-proof” the state to “protect California values.” New York Governor Kathy Hochul and other blue-state governors are taking similar actions, seeking to challenge perceived threats from President-elect Donald Trump before he takes office.

It’s not surprising that, after Trump’s victory, those on the left who hope to succeed him in 2028 are doubling down on protecting their progressive values. However, it would be wise for Newsom to examine where and why Trump made more significant inroads in the Golden State than in 2020.

Trump flipped nine counties that were won by President Biden in 2020, including nearly all the state’s inland counties. The demographics of these counties mirror the demographics of Californians leaving the state. According to a 2024 study by the Public Policy Institute of California, 600,000 Californians have left the state over the last decade. Due largely to the state’s extremely costly housing, they relocated to more affordable states such as Texas, Idaho, and Arizona.

This exodus comes at a tremendous political cost to the Golden State. According to the American Redistricting Project, based on 2022 population changes, California will lose five congressional districts in the 2030 reapportionment, while Texas will gain four. Idaho and Arizona will each gain one. That’s not a good look for a California politician eyeing the White House.

Governor Newsom should instead focus on passing legislation and enacting policies that address the reasons residents are leaving the state and reverse the flow of Californians to red states. The biggest reason is housing affordability.

According to the California Association of Realtors, the median price of an existing single-family home sold in October was nearly $889,000. In January 2019, when Newsom was sworn in, the median price was just under $537,000. And at the bottom of the housing recession in 2011, it was just over $271,000.

As the Governor realized when he was running for office in 2018, housing costs were soaring due to a lack of supply. He called for 3.5 million new homes to be built by 2025 – 500,000 per year. However, in his first five years in office, only 568,000 housing units were built. That’s because California, more than any other state, makes building new homes and apartments extremely difficult and expensive.

During his last two years in office, I suggest the Governor return to his focus on housing production. While he can’t catch up to 3.5 million, he can facilitate producing 400,000 new homes annually instead of the roughly 115,000 produced at present by embracing these three priorities:

1.??????? Meaningful CEQA Reform. The California Environmental Quality Act (CEQA) is often “weaponized” to block or delay housing development. Limiting who can bring suit against a development proposal or narrowing the scope of what constitutes an “environmental impact” can sharply increase the predictability of homebuilding, leading to more housing.

2.??????? Infrastructure Investment. Many jurisdictions use impact fees that can average more than $100,000 per home to cover the cost of housing growth and the upkeep of existing infrastructure. Government infrastructure investment can significantly contribute to more affordable and accessible housing markets, while also fostering economic growth.

3.??????? Construction Career Technical Education. Over the past decade, California's construction labor costs have significantly increased due to labor shortages and the rising demand for skilled workers. In 2024, the cost of labor in construction is reportedly growing by about 3.8% year over year nationally, with California experiencing higher rates due to regional demand and cost-of-living adjustments. Investment in the next generation of skilled workers, starting with hands-on trades education in middle schools, can lead to developing a next-generation skilled workforce.

By not simply engaging in ideological battles, Newsom can focus on what the people elected him to do – govern. He should address the underlying causes of California’s housing policy crisis, which drives the state's housing shortage. Doing so will improve the lives of California’s working class, allowing them to achieve the dream of homeownership. It would also distinguish Newsom as a deserving mantle-bearer for his party.